6 2 points Warranty liabilities a Hs 123112 unadjusted accru

6. (2 points) Warranty liabilities

a) H’s 12-31-12 unadjusted accrued warranty liability account had a debit balance of $9,000. A detailed analysis of this account as of 12-31-12 indicated H needed a $768,700 balance. Prepare the entry H should make to adjust the balance in its 12-31-12 accrued warranty liability account.

b) G’s 12-31-13 unadjusted accrued warranty liability account had a credit balance of $30,250. A detailed analysis of this account as of 12-31-13 indicated G needed a $39,340 balance. Prepare the entry G should make to adjust the balance in its 12-31-13 accrued warranty liability account

Solution

a Warranty expense 777700 =768700+9000        Warranty liability 777700 b Warranty expense 9090 =39340-30250        Warranty liability 9090